The largest networks in the world, called Tier 1, don’t purchase Internet access. They are part of the core network itself. Those major world wide networks exchange traffic on basis of equals called peering. Each network gets as much traffic as it sends to the others, so all benefit and no money is exchanged.
Everyone else has to get to the Internet by accessing one of these Tier 1 networks. The next level down, the Tier 2 networks, are also very large Internet service providers. Since they don’t have the enormous global traffic to participate in peering, they purchase what is called IP Transit. This is Internet access sold on a per Megabit per second per month basis.
Smaller Tier 3 networks can purchase IP Transit from Tier 2 networks, if they are large enough to have an assigned AS or Autonomous System number (ASN) to identify them as part of the Internet. Large scale ISPs fall into this category as well as some large corporations and other organizations.
Local and regional Internet Service Providers, including WISPs (Wireless Internet Service Providers), buy DIA or Dedicated Internet Access. DIA connections are like point to point private lines, except that one end connects to the Internet. Other private line characteristics still apply. The bandwidth provided is completely dedicated to the ISP and not shared with anyone else. There are generally SLAs or Service Level Agreements that spell out characteristics such as maximum latency, jitter and packet loss as well as time to respond to outages and time to make repairs.
Dedicated also means that there are no extra charges for heavily loading the line. You can use the entire capacity of the circuit in both directions or only some of it. The price is the same.
The smallest DIA service is usually a T1 line running at 1.5 Mbps. This is a symmetrical service, meaning 1.5 Mbps upload and 1.5 Mbps download. Usually the download path is much heavier loaded than the upload path for typical Internet access. If fact most consumer Internet access is sold with 5x to 10x higher speeds on download than upload. For business users, upload speeds can be important when transferring large files to remote backup sites and servers within colocation centers.
Obviously, T1 lines can’t serve a large user base but they work great for WiFi hotspots and rural or subdivision WISP service where signed-up customers number in the dozens, not hundreds. A nice feature of T1 lines is that they can be bonded by adding more lines to double, triple and quadruple bandwidth up to about 10 or 12 Mbps. The other nice feature of T1 lines is that they are available where other line services don’t reach. If you can get business telephone system into a facility, you can probably get T1 DIA service.
The next increment in traditional telecom bandwidth is DS3, also called T3 lines. This service runs at 45 Mbps which is large enough for a good size service provider to offer competitive bandwidth. Beyond that, SONET fiber optic services include OC3 at 155 Mbps, OC12 at 622 Mbps and OC48 at 2.5 Gbps are very popular.
A strong competitor to T-Carrier and SONET bandwidth is Carrier Ethernet. It comes in two flavors, Ethernet over Copper (EoC) typically from 1 to 50 Mbps and Ethernet over Fiber (EoF) from 10 Mbps to 10 Gbps. In a some metropolitan areas, you can also get EoFW or Ethernet over Fixed Wireless at DS3 and Fast Ethernet speeds. Where available, Carrier Ethernet tends to have considerably better pricing than other services.
Do you resell Internet access to other ISPs or end users? If so, see if you can get better wholesale pricing on Dedicated Internet Access and IP Transit services.